MGM Resorts International (MGM)
Return on total capital
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 1,560,300 | 1,933,060 | -2,152,760 | 374,894 | -835,099 |
| Long-term debt | US$ in thousands | — | — | — | — | — |
| Total stockholders’ equity | US$ in thousands | 3,023,480 | 3,811,170 | 4,831,530 | 6,070,640 | 6,504,730 |
| Return on total capital | 51.61% | 50.72% | -44.56% | 6.18% | -12.84% |
December 31, 2024 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $1,560,300K ÷ ($—K + $3,023,480K)
= 51.61%
The return on total capital for MGM Resorts International has shown significant fluctuations over the years. In December 2020, the return on total capital was negative at -12.84%, indicating that the company's capital utilization was inefficient, resulting in a loss on capital invested.
By December 2021, the return on total capital improved to 6.18%, suggesting that the company was able to generate a positive return on its total invested capital. This positive trend continued into December 2022 with a return on total capital of -44.56%, falling back into negative territory.
However, in December 2023, there was a remarkable recovery in the return on total capital, surging to 50.72%, indicating a significant improvement in capital efficiency and profitability. This positive momentum continued into December 2024, where the return on total capital reached 51.61%, reflecting the company's ability to generate more than a dollar in profit for each dollar of capital invested.
Overall, the return on total capital for MGM Resorts International has shown volatility but demonstrated a strong rebound in recent years, signalling improved capital utilization and profitability.
Peer comparison
Dec 31, 2024